The Ohio Democrat. (Logan, O. [Ohio]) 1886-1906, 1887-07-23
The Pacific Railroad Frauds

Some Interesting 9flnds" have
been made by the Pacific Railroad
Commission in the course of its in
vestigations in the west. In addi-
tion to the list of Kansas Pacific
lobbyists and benefciaries found
among the papers of John G. FIRE.
mont the Commission has gathered
some valuable information con-
cerning the financial methods en-
ployed in conducting the Pacific
railroads. When the Commission
was in Omaha, Engineer Dey
testified that his estimates for the
first hundred miles of Union
Pacific Railroad west from Omaha
were at the rate of $4,000 a mile,
and for the next 400 miles at the
rate of $4,000. But the railroad
managers insisted that he should
estimate the average cost of con-
struetion at $4,000 Il mile in order
that they might strike the Govern
ment for more subsidy. Upon his
refusal he was dismissed, and more
accommodating engineers cstimat-
ed the cost at from $4,000 to $40,
90 q mile westward from Omaha;
further west the estimate was ut
the rate of $4,000 a mile, and in
some instances the cost was carried
up to nearly 100000 a mile. The
actual construction of the road cost
but two-thirds of the Government
subsidy and the balance the rascals
put in their pockets. They never
contributed a dollar to the making
of the road, for, as the books of the
company show, the nominal cap
ital of $3G,O00,000 was never paid
in. What with this and other
great sums gained through such
methods as hypothecations of land
grants at $4,000 q mile and $4,000
u mile ofincome bonds, they pocket
ed not less than $lOO,OOO,OOO stolen
from the Government and the
people.
In delightful obliviousness of
these facts Mr.. Jay Gould suggest
ed, just about the time Engineer
Dey's testimony and other evid-
ence was presented to the Commits
sion, that the Government should
not exact any of the accrued inter-
est due from the Union Pacific
Railroad Company, but should be
content with the payment of the
principal only. The ground for
this suggestion was that the rail-
road had cost so much for it's con-
struction as to be unable to COM
plete with rival roads built at much
less expense. 1t has been seen
that the cause of this excessive
cost was in the deliberate fraud of
the railroad manipulators upon the
Government. Every dollar of this
enormously fraudulent expense
came out of the public Treasury,
yet Mr., Gould talks as if it had
been paid by the men who SO sue
cessfully managed this monstrous
scheme of plunder.
Unfortunately, much of the stock
which originally represented moth
ing but fraud has gone into the
hands of innocent purchasers for
n valuable consideration. That
however, affords no reason why the
Government should not receive fnll
payment of the principle and in
terest of it's debt, provided that the
money can be made out of the
earnings of the road. Upon this
point the report of the Commission
of Investigation will doubtless af-
ford much valuable information
for the guidance of the next Con-
gress. 1t would be in the highest
degree desirable to compel the
parties who plundered the Govern
ment so extensively in the con-
struction, of this road to make resti-
tuition, but most of them are out of
reach, and the subject will have to
he considered by Congress without
regard to their original connection
with it.